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July 29, 2002 at 08:00 PM
A few times a year, Jason Weybrecht of Spero-Smith Investment Advisers Inc. in Cleveland plays Monopoly with the children of one of his clients. “We meet to discuss how stocks and bonds work, and the importance of budgeting,” he says. “We began playing board games with them just to start talking about money. It’s important to our clients that their kids have a solid understanding of saving, spending, and planning for their future.”
While spending an afternoon with children isn’t a typical advisor’s routine, Weybrecht is just one of many advisors following a new trend in family financial planning. In fact, many advisors are taking a special interest in their clients’ offspring.
“Why would we only help our adult clients and not offer to help the people they love?” asks Charles E. Foster, II, of Blankinship & Foster, a family wealth advisory firm in Del Mar, California. “Although most clients do not have their children’s understanding of money as their first goal, it often becomes one.” Foster usually meets with older children in their teens and helps them understand money and investments as tools.
A few hundred miles down the road, Melissa Hammel is holding class for a small group of six-year-olds. Hammel, a partner with Hammel Financial Advisory Group, LLC, in Brentwood, Tennessee, spends two to three weeks each year teaching all of her clients’ children about money and how to manage it.
“With the real little kids, I’ll show them the differences between dimes and nickels and explain concepts like value and worth,” she says. “I’ll also buy a few toys and explain to them that each toy has a cost and how [to buy] more expensive ones [you] need more money.”
For the older children, Hammel goes over these same concepts at higher levels. “I talk to the high school kids about saving for the prom or for a computer,” she explains. Most of their parents have already taken care of the their college savings, so she says she tries to relate to them on more familiar terms. And for the few college students she works with, Hammel helps them put together their own savings plans, create goals, and understand compounding and credit.
This shift in the financial planning industry toward including all family members in the planning process is something some advisors agree is a necessity for everyone involved. “In many cases if you do not build a relationship with clients’ children, all of your work and planning will walk out the door once your client dies,” Weybrecht says. “I think people are concerned that their children will not understand how to manage or maintain their wealth when they have to.”
